Posts Tagged ‘Gold Miner’

Gold’s rally peaked on July 10th & ever since, immense uncertainty has prevailed. Our case for gold is to consider the long haul. Whether or not there could be a gold market correction is not the issue. We trust the fundamentals: it is clear that we are still in the middle of the long-term gold rally. Gold has not seen the end of it; there is still a long, long way to go.

There’s a difference between the narrative, which is what you’re being told, versus the reality of the economic data. It’s in no one’s interest ahead of the election to say the U.S. economy is a mess. If the flood of bad economic data continues, the Fed will almost certainly print more money or cut interest rates. And that could easily send the price of gold through the roof.

According to a report issued by Goldman’s Eugene King looking at commodity scarcity, the chart here “shows that there are only 20 years of known mineable reserves of gold and diamonds.” Here are some further observations on gold and scarcity in general from Goldman.

Chinese gold financing deals are processed in a different way compared with copper financing deals, though both are aimed at facilitating low cost foreign capital inflow to China. Specifically, gold financing deals involve the physical import of gold and export of gold semi-fabricated products to bring the FX into China.

Current participants in the gold lease market are commercial banks, gold miners and jewelers. The Shanghai Gold Exchange also provides a crucial role in gold leasing. The SGE’s block trading system is the trading platform used by gold leasing participants; the SGE also provides transfer and settlement services.